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Does North Block have too many advisers?

A K Bhattacharya

Finance ministers, like all Cabinet ministers at the Centre, enjoy special privileges. One of these privileges is that they can appoint a secretary-level official, in addition to the sanctioned posts. They can also appoint an adviser in the rank of a minister of state.

In recent times, Manmohan Singh was the first finance minister to have taken advantage of the privilege of appointing, both, a secretary-level officer and an adviser in the rank of a minister of state.

He had Dr Ashok Desai as chief consultant and then he had Dr Raja Chelliah as an adviser in the rank of a minister of state. Both, however, did not stay with him for long.

P Chidambaram settled for only an officer on special duty in Jairam Ramesh. Yashwant Sinha too opted for an adviser in Mohan Guruswamy.

But Guruswamy did not last long and left Sinha in less than a year of his joining. Sinha opted for another adviser in Dr Rakesh Mohan, who too left the ministry after about 18 months.

Finance Minister Jaswant Singh also seems to be fond of advisers. He has appointed former finance secretary, Dr Vijay Kelkar, as his advisor.

Kelkar has already joined the North Block. His brief is simple. He would advise the finance minister on all policy issues referred to him.

By next week, there would be one more appointment in the North Block. Ashok Lahiri would be joining the finance ministry as the chief economic advisor. With Dr Lahiri in place, the finance ministry would have the rare privilege of having five secretary-level officers.

Indeed, in less than two months of assuming charge as finance minister, Jaswant Singh has put in place a high-powered team of officials and advisers to assist him in the North Block. This is quite an achievement.

His predecessor Yashwant Sinha might well be envious of him. For, when Singh joined the ministry in the first week of July, there was neither a finance secretary nor a chief economic advisor.

The economic affairs secretary was in an exit mode, as he had already been appointed executive director on the board of the World Bank. The post of the chief economic adviser also was vacant and the interviews for the job were yet to be held.

The first appointment cleared by the finance minister was that of S Narayan as the new finance secretary. He brought in A V Singh as the revenue secretary. He also upgraded the post of the banking and insurance division to that of a full-fledged secretary.

With Kelkar in place and Lahiri expected by next week, the North Block should now boast of a rich pool of secretaries and advisers.

While that might be give the finance minister some comfort, there are others in the government who wonder if the finance ministry has filled itself with too many experts and advisers.

A similar question was raised when Manmohan Singh decided to bring in Shankar N Acharya as the chief economic adviser even though the ministry had a chief consultant and a full complement of secretaries led by finance secretary Montek Singh Ahluwalia.

The justification then was that at a time the economy was going through a critical phase of reforms, the finance ministry could do with even a few more experts and economists as advisers.

Ten years later, the scenario is quite different. Economic reforms have entered a new phase. An adviser for the finance minister can make a lot of difference to the way reforms are to be managed by the government.

But what would then be the role of a chief economic adviser ? If Dr Kelkar's brief is to advise the finance minister on policy issues referred to him, what would be Dr Lahiri's brief ?

The chief economic adviser has traditionally played the role of leading the think tank in the finance ministry. He is responsible for providing the macro-economic policy input for all proposals that might come up before the minister for his considerations.

What role would the finance minister's adviser play on such matters? These are questions that need to be answered if Singh has to ensure a smooth functioning in the finance ministry.

Bureaucrats always make sure that they do not lose their power in decision making. An administrative structure in which a key adviser only reports to the finance minister and advises only on policy issues referred to him can be very restrictive in its scope.

If the system has to take full advantage of Kelkar's expertise and experience in economic administration, he has to be given a more direct role in decision making in the finance ministry.

That can happen if Kelkar's advisory role is not restricted only to policy issues referred to him, but also on other policy issues being decided on in the finance ministry. It is only then that he can make a substantive difference to economic policy making in the North Block.

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